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4. You are given the following cost data for France, where they have nothing but capital and labor and make nothing but bread and wine.

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4. You are given the following cost data for France, where they have nothing but capital and labor and make nothing but bread and wine. To make a loaf of bread To make a bottle of wine capital input 5 francs 20 francs labor input 4 francs 10 francs total cost 9 francs 30 francs a. Is bread-making more capital-intensive than wine-making or vice versa? Explain. b. Suppose trade opens and the price of wine rises while the price of bread falls. If capital and labor were completely immobile between bread-making and wine-making, who in France would gain from the shift in prices? Who would lose? (Consider the four groups of bread capitalists, bread laborers, wine capitalists, and wine laborers.)

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